Cost of living in Portugal

The cost of living in Portugal

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Can you afford to live in Portugal? Prices in Portugal for utilities, groceries, education and property are likely to be different to in your home country. See if a Portuguese lifestyle fits your budget.

Portugal is the most reasonably priced country in western Europe and offers a comfortable lifestyle to many expats. This guide provides an in-depth overview of the cost of living in Portugal and covers essentials such as housings, education, groceries, childcare, taxes, eating out and social security. 

With its enviable climate, stunning landscapes and affordable cost of living, Portugal is growing in reputation amongst expats. The Algarve is often cited as one of the best places to retire, whilst the other-worldly charms of Lisbon, Oporto, Coimbra and Cascais offer a peaceful and cultural setting. 

Living in western Europe can be very expensive for expats unless you earn a good wage. But Portugal breaks the mould and offers an affordable living for expats that earn a modest wage as well.

Prices in Portugal

Cost of living in Portugal

Portugal does not perform very well in the OECD better life index although many expats would disagree with the statistics. Earnings may be lower in Portugal than other comparable western European countries, but this is merely a reflection that the cost of living is substantially lower as well. If anything expats can afford a better lifestyle in Portuguese cities than most other cities in the world.

The average net-disposable income per household in Portugal is €18,000 a year. Many of the locals live off €750 a month. For a couple bringing in €2000-€3000 a month, you can enjoy an excellent lifestyle in Portugal.

The only city to make the Mercer Quality of Living Survey in Portugal is the capital, Lisbon. Having said that, the only other two cities in the country that Mercer actually surveyed were Oporto and Aveiro, neither of which are favourites with expats. Lisbon is also the most expensive city to live in Portugal, but as you can see from the figure below is much more affordable than other cities in the world.

Cost of living in Portugal: Lisbon

  • 56 percent less expensive than Zurich
  • 53 percent less expensive than New York
  • 26 percent less expensive than Munich
  • 9 percent less expensive than Madrid
  • 20 percent less expensive than Brussels
  • 37 percent less expensive than Paris
  • 48 percent less expensive than London
  • 15 percent less expensive than Rio de Janeiro
  • 41 percent less expensive than Los Angeles

Cost of living in Portugal: Oporto

  • 64 percent less expensive than Zurich
  • 62 percent less expensive than New York
  • 39 percent less expensive than Munich
  • 25 percent less expensive than Madrid
  • 34 percent less expensive than Brussels
  • 49 percent less expensive than Paris
  • 57 percent less expensive than London
  • 30 percent less expensive than Rio de Janeiro
  • 51 percent less expensive than Los Angeles 

Cost of living in Portugal: Coimbra

  • 64 percent less expensive than Zurich
  • 62 percent less expensive than New York
  • 40 percent less expensive than Munich
  • 26 percent less expensive than Madrid
  • 35 percent less expensive than Brussels
  • 49 percent less expensive than Paris
  • 58 percent less expensive than London
  • 31 percent less expensive than Rio de Janeiro
  • 52 percent less expensive than Los Angeles 

Cost of living in Portugal: Cascais

  • 54 percent less expensive than Zurich
  • 52 percent less expensive than New York
  • 24 percent less expensive than Munich
  • 7 percent less expensive than Madrid
  • 17 percent less expensive than Brussels
  • 34 percent less expensive than Paris
  • 45 percent less expensive than London
  • 12 percent less expensive than Rio de Janeiro
  • 38 percent less expensive than Los Angeles
 
Prices in Portugal: Compared

Portugal property prices

The cost of renting and buying a house in Portugal is surprisingly affordable considering how expensive other countries are in western Europe. Portugal suffered badly after the economic collapse that paralyzed Europe in 2008 but has been steadily recovering since 2015.

Reports indicate that a two-bedroomed property in The Algarve or Lisbon will cost somewhere in the region of €105,000-€180,000. The average cost per sq. m is €1,308. In the slightly less expensive cities of Coimbra and Cascais, you will find a three-bedroom apartment from €150,000 - €180,000. House prices in Oporto are similar but typically smaller and older.

In rural areas, house prices are substantially lower. A three-bedroomed property averages somewhere in the region of €100,000-€120,000 mark, but some properties have been known to go for as little as €35,0000 in the Portuguese countryside. However, if you work in the city, the price of petrol costs around the same as your mortgage, so should be factored into your budget when choosing a location to live.

Renting a city apartment in Lisbon or one of the charming Algarve towns is possible for under €600 whilst a 3-bedroomed serviced apartment can be as much as €2500 a month.

Elsewhere around the country, you can find rental costs for as low €450-€800 for a 2-bedroomed apartment. Unfurnished apartments are even less expensive. Expats with a family looking for buildings with modern amenities should expect to pay between €1200-€2000 a month. 

The cost of living in Portugal: Utilities - gas, water, electricity

Portugal enjoys a mild climate which significantly reduces the cost of utilities. According to the 2017 figures produced by Numbeo, the average cost of electricity, gas and water in Portugal is €86 a month for an apartment of 85 sq.m. Bills arrive every two months. 

The country also has good wi-fi coverage and most rented apartments are serviced with broadband and telephone. Packages start from around €25. 

For more information about utilities in Portugal and how to get connected see our comprehensive guide here.

Prices in Portugal: Utilities

Public transport prices in Portugal

The cost of public transport is also cheap in Portugal and the major cities all have a good network of buses, underground trains and in some places, trams. Single fares on the underground are €1.45. You can also get day savers which give you unlimited access to buses and metro for €6.15.

The average prices in Portugal for transport per month are €39. In Porto, the underground to the outer zones is €36. Taxis in Lisbon have a flat rate of €2.25 and €1.60 per km thereafter. Other cities have a higher starting fare, but lower cost per km. The University city of Coimbra has the cheapest rates at €0.47km. For up to date prices use an online taxi fare finder.

Owning a car in Portugal is comparable to other western European countries. The price per litre of unleaded petrol is €1.82 and diesel is €1.67. If you are travelling on the highways you should expect to pay a toll, and more if you are travelling long distance. Driving long distance in Portugal can add €20-€30 onto your journey. 

Grocery prices in Portugal

Staple foods in Portugal remain low, but expats should still budget around €200-€300 a month on grocery shopping if you like to throw in a few luxury items. You can get good wine for under €10 and beer from the supermarkets can be as low a €1.

Given Portugal’s location on the coast, fresh fish is very reasonably priced. Shrimp and tuna are around €8, but you can find cheaper fish such as Dorada for around €5. Meat is around €7-€10, but chicken is much more affordable at around €2.50. For the latest food prices check out this website.

Prices in Portugal: Groceries

Education prices in Portugal

Schools in Portugal are funded by the state and registered expats are free to send their children to a state school free of charge. However, lessons are conducted in Portuguese and the level of education has come in for some criticism over the years.

The majority of expat children attend private schools or international schools which makes educating your children expensive. Universities are much more affordable compared with other EU countries.

Private schools focus on the Portuguese curriculum but are taught in dual languages. International schools allow your children to take the curriculum of your native country.

Tuition fees vary so you should contact the school directly. However, to give you an idea of average costs, a private school in Lisbon charges €10,000 and €20,000 a year in tuition fees plus a €3,250 levy and a further €950 registration fee. The British school in Oporto charge €8,228-€12.091 per annum with a €300 and €70 registration fee.

Portugal also has public and private Universities. Public universities are much cheaper. Tuition fees start at around €950-€1250 a year for a bachelor or a master. A PhD is approximately €2500-€3000.

Tuition fees at private Universities are significantly higher starting at around €3,323 - €3,872 a year for any level degree. Students also have to pay a registration fee of €25-€35.

Coimbra is a popular city for students to study in Portugal and also has one of the lowest tuition fees in the country. Courses are €1500-€1800 a year. The most expensive University is Aveiro which costs €5000 per annum. 

Healthcare prices in Portugal

The World Health Organisation (WHO) rate Portugal’s healthcare system as one of the best in the world. Ranked 12th, it is way ahead of both the UK and the US. Although very little healthcare is free in Portugal, the healthcare system is low cost for residents enrolled in the social security system. Consultancy fees with a doctor are just €5 and €10 for emergency treatment.

Employers are obligated to appoint employees with health insurance and pay contributions each month. Health insurance can cost anything from several hundred euros to over a thousand. Insurance companies typically only pay around 60 to 80 of the treatment costs so check your health insurance policy if you take out private healthcare insurance.

If you’re self-employed, you must provide proof of health insurance to register for a residency permit. For more information about healthcare in Portugal, see our comprehensive guide here

Cost of living in Portugal: Healthcare

Childcare costs in Portugal

Childcare services in Portugal include crèches, nurseries, childminders and kindergartens. Crèches generally only accept children between three months and three years and can cost anything between €100 - €400 whilst kindergartens between €300 and €650 a month.

By law, childminders in Portugal have to be a minimum age of 21. Nannies and au pairs in Portugal can demand fees of around €180 a week. If you use an agency to find an au pair you also have agency fees on top of that. Expats should budget at least €200 a week for childminding services in Portugal. 

Cost of living in Portugal: Dining out

Expats living in Portugal will probably have the opportunity to eat out more often than their European neighbours. A sit-down lunch will cost around €15, or you can buy large sandwiches for €5 and can feed two people. Fast food is around €5-€6.

The average bill for an inexpensive restaurant in Portugal is €7 including a glass of house wine. For mid-range prices, you will be looking at €20-€40 for 2 people. A bottle of wine is €7 upwards. Anything more extravagant will be €25-€35 per head.

Prices in Portugal: Restaurants

Tax prices in Portugal

Personal income tax is removed at source from your monthly salary. As a general rule, married couples are taxed separately, although you can choose to be taxed jointly. Self-employed tax returns should be filed online or by paper between 1 April and 31 May. The tax brackets on earnings are:

  • €0.00 - €7000 – 14.5%
  • €7001 - €20,000 – 28.5%
  • €20,001 - € 40,000 – 37%
  • €40,001 - €80,000 – 45%
  • Over €80,000 – 48%


For detailed information about the tax system and taxable income in Portugal, see our in-depth guide here.

Cost of living in Portugal: Social security and pension costs

Residents that are registered with the social security system in Portugal pay contributions directly from your monthly salary at a rate of 11% of your gross earnings. A further 23.75% is paid by your employer. If you are self-employed you are obligated to pay 25.4% a month on your declared income. The social security system in Portugal protects contributors against unemployment, maternity, occupational diseases, invalidity, pension and death.

You can find more details about the social security system in Portugal here.

For economic indicators of prices, such as inflation and tax news see the Portugal Government’s website.

 

Click to go to the top of our guide to the cost of living in Portugal.

 

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